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AB 197
THIRD READING
Bill No:
Author:
Amended:
Vote:
AB 197
Eduardo Garcia (D), et al.
8/19/16 in Senate
21
PRIOR VOTES NOT RELEVANT
SENATE ENVIRONMENTAL QUALITY COMMITTEE: 5-2, 6/29/16
AYES: Wieckowski, Hill, Jackson, Leno, Pavley
NOES: Gaines, Bates
SENATE APPROPRIATIONS COMMITTEE: 5-2, 8/11/16
AYES: Lara, Beall, Hill, McGuire, Mendoza
NOES: Bates, Nielsen
SUBJECT: State Air Resources Board: greenhouse gases: regulations
SOURCE: Asian Pacific Environmental Network
California Environmental Justice Alliance
DIGEST: This bill creates the Joint Legislative Committee on Climate Policies,
requires the Air Resources Board (ARB) to prioritize direct emissions reductions
when adopting rules and regulations to achieve emissions reductions beyond the
statewide greenhouse gas (GHG) limit, and specifies requirements for reporting
GHG emissions, criteria air pollutants, and toxic air contaminants, for facilities,
sectors, and emissions reduction measures. This bill also requires that two
legislative members serve as ex-officio, nonvoting members of ARB.
Senate Floor Amendments of 8/19/16 make a number of changes including 1)
adding intent language, 2) modifying provisions related to the Joint Legislative
Committee, 3) defining social costs, 4) requiring ARB to consider social cost and
prioritize rules and regulations that achieve direct emissions reductions and when
adopting rules and regulations to obtain emissions reductions beyond the statewide
GHG emissions limit, 5) removing the requirement to rank emissions reduction
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measures, and 6) specifying how ARB is required to report GHG and air pollution
emissions for facilities, sectors, and emissions reduction measures.
ANALYSIS:
Existing law:
1) Establishes ARB with 14 members, 12 of which are appointed by the Governor
with consent of the Senate, and two members appointed by the Senate
Committee on Rules and the Speaker of the Assembly, respectively. Of the 12
members appointed by the Governor, six must have specified qualifications
and six must be board members from air districts, and the two members of the
Legislature are required to be persons who work directly with pollutionburdened and vulnerable communities. (Health and Safety Code §39510)
2) Requires, under the California Global Warming Solutions Act of 2006 (HSC
§38500 et seq.), ARB to do the following:
a) Determine the 1990 statewide GHG emissions level and approve a
statewide GHG emissions limit that is equivalent to that level, to be
achieved by 2020, and to adopt GHG emissions reductions measures by
regulation to achieve the maximum technologically feasible and costeffective reductions in GHG emissions in furtherance of achieving the
statewide GHG emissions limit. ARB is authorized to include the use of
market-based mechanisms to comply with the regulations.
b) Prepare and approve a scoping plan by January 1, 2009, for achieving the
maximum technologically feasible and cost-effective GHG emissions
reductions from sources or categories of sources of GHGs by 2020. The
plan must be updated at least once every five years.
c) Adopt regulations to require the reporting and verification of statewide
GHG emissions.
3) Requires ARB to establish a program to inventory sources of air pollution
within air basins and monitor air pollutants in cooperation with local air
districts.
This bill:
1) Establishes the Joint Legislative Committee on Climate Change Policies,
consisting of at least three members of the Senate and at least three members
of the Assembly, to ascertain facts and make recommendations to the
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Legislature concerning the state’s climate change programs, policies, and
investments.
2) Requires ARB to post and update at least annually on ARB’s Web site GHG
emission and criteria pollutants, and toxic air pollutants emissions no later than
January 1, 2018, for all facilities subject to GHG emission reporting
requirements in a manner that illustrates emissions levels over time.
3) Requires ARB to post and update at least annually graphs of GHG emissions,
criteria pollutants and toxic air contaminants throughout the state broken down
to a local and subcounty level for stationary sources, and at least a county level
for mobile sources.
4) Requires ARB to prepare an informational report that evaluates emissions
trends and influences for those trends for GHG emissions, criteria pollutants,
and toxic air contaminants from sectors covered by the Scoping Plan, and
authorizes the report to include recommendations for legislative action and
consideration.
5) Requires the chair of ARB to present the informational report annually to the
Joint Committee on Climate Change Policies.
6) Requires ARB when adopting rules and regulations to achieve emissions
reductions beyond the 2020 statewide GHG emissions limit, to consider the
social cost of GHG emissions, follow specified requirements, and prioritize
rules and regulations that result in direct emissions reductions at large
stationary sources of GHGs, direct emissions reductions from mobile sources,
and direct emissions reductions from other sources.
7) Defines “social cost” as an estimate of the economic damages, including but
not limited to changes in agricultural productivity, public health impacts,
climate adaptation impacts, and changes in energy system costs, per metric ton
of greenhouse gas emissions per year.
8) Requires each Scoping Plan update to identify the range of GHG emissions
reductions, range of air pollution reductions, and cost-effectiveness, including
avoided social costs, for each emissions reduction measure.
9) Establishes six-year terms for voting members of ARB and authorizes voting
members to serve additional terms.
10) Specifies that a member of ARB whose appointment satisfies local air district
membership requirements for ARB’s makeup, shall not be a member of ARB
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effective immediately if they cease to hold the qualifying membership of a
local air district.
11) Requires that two legislative members serve as ex-officio, nonvoting members
of ARB, with one member appointed by the Senate Committee on Rules, and
the other member appointed by the Speaker of the Assembly.
12) Makes various findings and declarations, including the need to protect the
state’s most disadvantaged communities from the effects of climate change,
and for ARB’s GHG reduction actions to be performed in a transparent and
accountable manner.
13) Provides that the provisions of this bill are only operative if SB 32 (Pavley) is
enacted and becomes law on or before January 1, 2017.
Background
1) Air Resources Board. ARB was created in 1967 through the Mulford-Carrell
Act, which combined two Department of Health bureaus, the Bureau of Air
Sanitation and the Motor Vehicle Pollution Control Board.
Six of the board members must have certain qualifications (e.g., automotive
engineering; chemistry, meteorology, or related field; surgeon or an authority
on health effects). The other six members must be board members from the
following entities: South Coast Air Quality Management District (AQMD),
Bay Area AQMD, San Joaquin Valley AQMD, San Diego APCD, one of six
Sacramento region air districts, and a board member from any other district.
These board members must reflect the “qualitative requirements” of the other
six members to the extent practicable.
AB 1288 (Atkins, Chapter 586, Statutes of 2015) added two additional
members to the board, which increased the membership from 12 to 14,
appointed by the Senate Committee on Rules and the Speaker of the Assembly,
and requires those members be persons who work directly with pollutionburdened and vulnerable communities.
2) The Global Warming Solutions Act of 2006. In 2006, the Global Warming
Solutions Act of 2006, AB 32 (Núñez and Pavley, Chapter 488, Statutes of
2006) established a statewide GHG emissions limit by 2020. AB 32 defines
GHGs as carbon dioxide (CO2), methane, nitrous oxide, hydrofluorocarbons,
perfluorocarbons, and sulfur hexafluoride and requires ARB to determine the
1990 statewide GHG emissions level and approve a statewide GHG emissions
limit that is equivalent to that level, to be achieved by 2020.
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AB 32 requires ARB, among other things, to inventory GHG emissions in
California; implement regulations that achieve the maximum technologically
feasible and cost-effective reduction of GHG emissions and impose fees for
administrative implementation costs; adopt discrete early action measures;
prepare and approve a scoping plan; convene an Environmental Justice
Advisory Committee; and appoint an economic advisory committee to obtain
recommendations for GHG reduction measures.
The statute also specifies that ARB may include market-based compliance
mechanisms in the AB 32 regulations after considering the potential for direct,
indirect, and cumulative emission impacts from these mechanisms, including
localized impacts in communities that are already adversely impacted by air
pollution, and must design any market-based compliance mechanisms to
prevent any increase in the emissions of toxic air contaminants or criteria air
pollutants.
3) AB 32 Scoping Plan. Pursuant to AB 32, ARB approved the first Scoping Plan
in 2008. The Scoping Plan outlined a suite of measures aimed at achieving
1990-level emissions, a reduction of 80 million metric tons of CO2 (MMT
CO2e).
The 2008 Scoping Plan recommended that reducing GHG emissions from the
wide variety of sources that make up the state’s emissions profile could best be
accomplished through a cap-and-trade program along with a mix of other
strategies including:
 A low carbon fuel standard (LCFS);
 Light-duty vehicle GHG standards;
 Expanding and strengthening existing energy efficiency programs, and
building and appliance standards;
 Achieving a 33% Renewable Portfolio Standard;
 Regional transportation-related GHG targets; and
 Creating targeted fees on water use and high global warming potential
pollutants.
The basic design of the program, as recommended by the original Scoping
Plan, is that the combination of direct regulatory measures and cap-and-trade
is intended to achieve the emission reduction target by 2020. Specifically, the
Scoping Plan lays out a strategy where the overall limit on GHG emissions
from most of the California economy is “capped” through a cap-and-trade
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program, and direct regulations within both capped and uncapped sectors
would achieve additional emissions reductions.
Pursuant to authority under AB 32, ARB adopted a LCFS in 2009, and a capand-trade program, approved on December 13, 2011.
Scoping Plan update. ARB approved an update to the Scoping Plan on May 22,
2014. The update asserts that California is on track to meet the near-term 2020
greenhouse gas limit and is well positioned to maintain and continue reductions
beyond 2020 as required by AB 32.
Comments
Purpose of Bill. According to the author, “In order for California to remain an
economic and environmental leader the state will need to also be a leader on issues
related to equity. Placing the health and economic impacts of climate policy on
vulnerable populations second will stunt the state’s prosperity. A great degree of
transparency and investment in California’s environmentally and
socioeconomically disadvantaged populations has the potential to yield significant
climate, economic, public health and quality of life benefits while knocking down
barriers to opportunity.”
Related/Prior Legislation
SB 32 (Pavley, 2016) requires ARB to approve a statewide GHG emissions limit
of 40% below the 1990 GHG emissions level to be achieved by 2030 and specifies
the bill only becomes operative if AB 197 is enacted and becomes effective on or
before January 1, 2017.
FISCAL EFFECT: Appropriation: No
Fiscal Com.:
Yes
Local: No
According to the Senate Appropriations Committee:
 One-time costs of $100,000 (various special funds) to the ARB for construction
to enlarge the hearing room dais and to provide the equipment needed to
accommodate two additional board members.
 $233,000 annually (Cost of Implementation Fund) to the ARB for staffing
needs to support new board members and develop ranking criteria.
SUPPORT: (Unable to verify at time of writing)
Asian Pacific Environmental Network (co-source)
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California Environmental Justice Alliance (co-source)
Clean Power Campaign
The Nature Conservancy
OPPOSITION: (Unable to verify at time of writing)
Agricultural Council of California
Association of California Egg Farmers
Building Owners & Managers Association of California
California Association of Wheat Growers
California Bean Shippers Association
California Building Industry Association
California Business Properties Assoc.
California Chamber of Commerce
California Farm Bureau Federation
California Grain and Feed Association
California Independent Oil Marketers Association
California Independent Petroleum Association
California League of Food Processors
California Manufacturers and Technology Association
California Pear Growers Association
California Railroad Industry
California Seed Association
California Taxpayers Association
Family Business Association
International Council of Shopping Centers
NAIOP of California, Commercial Real Estate Development Association
National Federation of Independent Business, California
Western States Petroleum Association
ARGUMENTS IN SUPPORT: The Nature Conservancy argues this bill would
work alongside SB 32 to ensure that the state continues to develop and implement
the most effective climate policies in order to prevent climate change problems
from worsening. Clean Power Campaign states that AB 197 will strengthen the
role of the Legislature in advising ARB and climate change policies and will direct
ARB to prioritize measures that result in direct GHG emissions reductions from
large sources across sectors.
ARGUMENTS IN OPPOSITION: Opponents argue that while AB 197 does not
mandate a specific regulatory mechanism, it directs ARB to prioritize commandand-control regulations over a market-based compliance mechanism, which would
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undermine flexibility required for manufacturers to meet reduction obligations in
the most cost-effective manner. Opponents state that the creation of a Joint
Legislative Committee on Climate Change Policies and adding two non-voting
legislators to the board does not justify the empowerment of ARB with a post-2020
goal that does not include further limits on their authority.
Prepared by: Rebecca Newhouse / E.Q. / (916) 651-4108
8/22/16 12:07:12
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